If you have a loan on your vehicle, you may have noticed that there are certain types of auto insurance policies you are required to have. Many people aren’t sure why they have to provide more coverage simply because they have a loan on a vehicle, but the truth is that this coverage can provide benefits.
So, why do you have to have more coverage if you have a loan? Don Allred Insurance, which helps many drivers in Burlington, NC, can help you understand the insurance policies you benefit from.
Lenders Have Risks
Lenders often require more coverage for vehicles with loans because the lender is taking on more risk. The lender puts up the money, and they have a vested interest in ensuring that they recover either the loan payments or the vehicle in the future. If the vehicle is wrecked, they will not be able to recoup their funds.
If you have a loan on your car, there are a few types of coverage options that may be required. You may be required to carry comprehensive insurance as well as collision coverage to ensure that your vehicle is completely covered in the case of an incident.
Insurance Helps You Too
It is also important that you understand the benefits insurance has for you as well. You may also benefit from gap insurance, which helps you cover that loan even if your car is totaled.
Learn More About Insurance Requirements
Don Allred Insurance understands that you may have questions about car insurance and loan requirements. If you live in Burlington, NC, call our insurance agents to learn more about your insurance options even if you have a loan on your car.
Like other states, North Carolina has its own state laws in regard to how much insurance coverage its drivers must have. The amount required for many of these by the state is low when compared to many other states, so it may be a good idea to get more than the state requires in order to be better protected. If you need auto insurance, call us at Don Allred Insurance in Burlington, NC to find out more.
Bodily Injury Liability
This coverage is required in order to pay for injuries that are done to another person, or people when you cause an accident. There is a mandated minimum amount for one person who is injured and another minimum amount for everyone who is injured in the accident.
Property Damage Liability
This coverage comes with its own mandatory minimum amount. This coverage pays for damage to someone else’s property that is done when you cause an accident.
Uninsured Motorist Coverage
The state mandates that drivers carry uninsured motorist bodily injury insurance so that their injuries can be paid for if the accident was caused by a motorist who is uninsured. This coverage comes with a set amount for one person who is injured in an accident and another amount that is for everyone who is injured in it. There is also uninsured motorist property damage coverage required. This pays for the damage to your property that is caused by an uninsured driver.
All of these coverage types are important for staying legal on the road, and they are also helpful in case the worst should happen and there is an accident. Talk to your insurance agent if you are interested in getting more coverage than is required by the state.
Get Auto Coverage
If you drive in North Carolina, it’s vital that you have these coverages in place. Give us a call at Don Allred Insurance in Burlington, NC.